Note 7 - Income Taxes

3 Months Ended

Mar. 31, 2024

Notes to Financial Statements

Income Tax Disclosure [Text Block]

7. INCOME TAXES

The Company’s effective tax rate for the three month periods ended March 31, 2024 was 21.0% compared to 20.4% for the same period in 2023. Effective rates are dependent upon components of pretax earnings and losses and the related tax effects.

Income tax expense for the three month periods ended March 31, 2024 and 2023 differed from the amounts computed by applying the U.S. federal tax rate of 21% to pretax income from continuing operations as demonstrated in the following table:

	For the Three-Months Ended
	March 31,
	2024			2023
Provision for income taxes at the statutory federal tax rates	$	595,435		$	416,654
Increase (reduction) in taxes resulting from:
Tax-exempt interest income		(7,929	)		(10,072	)
Dividends received deduction		(10,065	)		(20,460	)
Proration of tax-exempt interest and dividends received deduction		4,283			7,417
Nondeductible expenses		15,915			15,091
Officer life insurance, net		(1,438	)		(3,110	)
Total	$	596,201		$	405,520

Management believes it is more likely than not that all deferred tax assets will be recovered as the result of future operations, which will generate sufficient taxable income to realize the deferred tax asset.

As of March 31, 2024 and December 31, 2023, the Company does not have any capital or operating loss carryforwards. Periods still subject to IRS audit include 2020 through current year. There are currently no open tax exams. As of March 31, 2024 a significant portion of the Company's net deferred tax asset relates to unrealized losses on fixed income securities and equity securities.